Abbott Issues Updated 2021 Outlook

Rhea-AI Summary

Abbott (NYSE: ABT) revised its 2021 financial outlook due to reduced COVID-19 testing demand, reflecting a shift towards normalization as cases decline and vaccination efforts accelerate. The revised guidance projects 2021 GAAP diluted EPS between $2.75 and $2.95, with adjusted diluted EPS expected to be between $4.30 and $4.50, demonstrating double-digit growth from the previous year. Despite the downturn in COVID-19 testing, Abbott's core business shows strong growth, supported by recent product launches. Financial adjustments include specified items of $1.55 per share for restructuring and alignment with current market demands.

Positive

• Projected full-year adjusted diluted EPS for 2021 is $4.30 to $4.50, indicating strong growth.
• Core business growth is accelerating, indicating resilience despite COVID-19 testing demand drop.

Negative

• Significantly lower demand for COVID-19 testing led to adjustments in financial guidance.
• Changes in health authority testing guidance for fully vaccinated individuals contributed to demand decline.

ABBOTT PARK, Ill., June 1, 2021 /PRNewswire/ -- Abbott (NYSE: ABT) today announced an update to its financial outlook for the full-year 2021. The updated guidance is due to significantly lower recent and projected COVID-19 diagnostic testing demand. This has been driven by several factors, including significant reductions in cases in the U.S. and other major developed countries, accelerated rollout of COVID-19 vaccines globally and, most recently, U.S. health authority guidance on testing for fully vaccinated individuals.

While it's positive that these external events and trends signal an accelerated return to normalcy for many countries, they have suddenly and fundamentally impacted market demand for COVID-19 testing, particularly for surveillance and screening with rapid testing.

As a result, Abbott now projects full-year 2021 diluted EPS from continuing operations under Generally Accepted Accounting Principles (GAAP) of $2.75 to $2.95 and full-year adjusted diluted EPS from continuing operations of $4.30 to $4.50, reflecting strong, double-digit growth versus the prior year.

Abbott made significant contributions to the global fight against COVID-19, including the development of 12 tests globally. Contributions from COVID-19 testing gave the company additional flexibility to further invest in its strong and growing base business that continues to see accelerating growth momentum, including contributions from several recently launched products across its portfolio.

"We've recently seen a rapid decline in COVID-19 testing demand and anticipate this trend will continue, which led us to adjust our full-year guidance," said Robert B. Ford, president and chief executive officer, Abbott. "At the same time, excluding COVID-19 tests, our organic base business growth is accelerating, we continue to see improving end-markets and our new product pipeline continues to be highly productive."

Abbott Conference Call
Abbott will conduct a live webcast of a special conference call through its Investor Relations website at www.abbottinvestor.com at 8 a.m. Central time today. An archived edition of the webcast will be available later today.

Abbott's Earnings-Per Share Guidance
Abbott projects 2021 diluted earnings per share from continuing operations under GAAP of $2.75 to $2.95. Abbott forecasts specified items for the full-year 2021 of $1.55 per share primarily related to intangible amortization, restructuring and cost reduction initiatives, including expenses to align its COVID-19 testing-related business with current and projected demand, expenses associated with acquisitions and other net expenses. Excluding specified items, projected adjusted diluted earnings per share from continuing operations would be $4.30 to $4.50 for full-year 2021.

Abbott projects second-quarter 2021 guidance for diluted earnings per share from continuing operations under GAAP of at least $0.39. Abbott forecasts specified items for the second quarter 2021 of $0.61 per share primarily related to restructuring and cost reduction initiatives, including expenses to align its COVID-19 testing-related business with current and projected demand, as well as intangible amortization, expenses associated with acquisitions and other net expenses. Excluding specified items, projected adjusted diluted earnings per share from continuing operations would be at least $1.00 for the second quarter.

About Abbott:
Abbott is a global healthcare leader that helps people live more fully at all stages of life. Our portfolio of life-changing technologies spans the spectrum of healthcare, with leading businesses and products in diagnostics, medical devices, nutritionals and branded generic medicines. Our 109,000 colleagues serve people in more than 160 countries.

Connect with us at www.abbott.com, on LinkedIn at www.linkedin.com/company/abbott-/, on Facebook at www.facebook.com/Abbott and on Twitter @AbbottNews.

— Private Securities Litigation Reform Act of 1995 —
A Caution Concerning Forward-Looking Statements

Some statements in this news release may be forward-looking statements for purposes of the Private Securities Litigation Reform Act of 1995. Abbott cautions that these forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those indicated in the forward-looking statements. Economic, competitive, governmental, technological and other factors that may affect Abbott's operations are discussed in Item 1A, "Risk Factors" in our Annual Report on Form 10-K for the year ended Dec. 31, 2020, and are incorporated herein by reference. Abbott undertakes no obligation to release publicly any revisions to forward-looking statements as a result of subsequent events or developments, except as required by law. 

 

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SOURCE Abbott

FAQ

What is Abbott's updated financial outlook for 2021?

Abbott projects a diluted EPS range from $2.75 to $2.95 under GAAP and adjusted EPS between $4.30 and $4.50.

How has COVID-19 testing affected Abbott's earnings projections?

A decline in COVID-19 testing demand has led Abbott to revise its earnings outlook downward.

What are the main factors affecting Abbott's revised guidance for 2021?

The reduction in COVID-19 cases, global vaccination efforts, and updated testing guidelines are primary factors.

What is the core business performance of Abbott amidst lower COVID-19 testing demand?

Abbott's core business continues to see strong growth despite the decline in COVID-19 testing.

What adjustments has Abbott made to its financial guidance due to COVID-19 testing changes?

Abbott adjusted its guidance due to lower testing demand, reflecting projected restructuring costs and realignment.